CAG dismisses coal scam report

The Comptroller and Auditor General (CAG) yesterday said its audit report on coal block allocations was still under preparation and a newspaper report suggesting a Rs 10.67 lakh crore loss to the exchequer was "exceedingly misleading" even as the opposition tried to corner the government on the issue.

In a letter to Prime Minister Manmohan Singh, the CAG disowned the report saying it was not of the view that the "unintended benefit to the allocatee is an equivalent loss to the exchequer". "In the extant case, the details being brought out were observations which are under discussion at a very preliminary stage and do not even constitute our pre-final draft and hence are exceedingly misleading," the CAG said.

The CAG said it has changed its thinking on the draft reports following the clarifications provided by the concerned ministry. "Pursuant to a clarification provided by the ministry in exit conferences held on February 9, 2012 and March 9, 2012, we have changed our thinking," it said.

"In fact, it is not even our case that the unintended benefit to the allocatee is an equivalent loss to the exchequer." A newspaper yesterday reported that the CAG in its draft report on coal mining has accused the government of having given "undue benefits" to a number of companies, leading to a loss of Rs 10.67 lakh crore to the national exchequer during 2004-09.

The Prime Minister's Office said in a statement that it received a letter from the CAG yesterday afternoon. The CAG said "the leak of the initial draft causes great embarrassment as the audit report is still under preparation. Such leakage causes very deep anguish".

Reacting on the development, Finance Minister Pranab Mukherjee said a mere draft cannot be termed as a report of the auditor. "This is not a CAG report. This is a draft report. Normal practice is -- draft report, then ministries comments, then there is a regular system through which it will have to be placed on the table of the house," Mukherjee told reporters.

Coal Minister Shriprakash Jaiswal said he had "no information" about the scam, adding that he would wait for the final audit report. "I am coal minister only in the UPA-2 and during this time no coal block was given. I can't comment based on media reports. If we receive the CAG report then we will analyse it," he said.